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Last Updated: Friday, 19 August 2005, 17:01 GMT 18:01 UK
Protests halt Ecuador oil exports
Soldiers guard a street in Coca, Ecuador
The unrest has left dozens injured
Ecuador's state oil company has stopped crude oil exports following days of protests from demonstrators wanting a bigger share of oil revenues.

The government has said it faced an "economic emergency" as a result of the stoppage, which has sent world oil prices higher.

The protesters want more money to be spent on infrastructure and new jobs.

Late on Friday, Defence Minister Solon Espinosa resigned. His replacement is reportedly a former Army general.

Oil price rises

Quito, the capital, has called in the army, which has used tear gas to disperse some of the protesters. The unrest has resulted in dozens of injuries.

Map of Ecuador

But a senior official in Sucumbios, one of the provinces involved in the action, said his province's people were in revolt. Guillermo Munoz challenged the army "to throw us all in jail".

News of the halt in Ecuador's crude exports, as well as ongoing concerns over the tight level of US gasoline supplies, pushed the price of oil closer to $64 a barrel.

US crude oil rose $1.63 to $64.90 a barrel, under pressure both from the Ecuador situation and from a rocket attack against two US ships in a Jordanian port.

London-traded Brent crude rose $1.05 cents to $63.50 a barrel.

The price of US crude had been falling from last Friday's record high of $67.10 a barrel.

Key resource

Correspondents say the unrest is the worst faced by President Alfredo Palacio since he came to power in April.

They say he is under pressure at home to abandon the free-market policies of his ousted predecessor, Lucio Gutierrez.

Not all sections of Ecuadoran society have benefited equally from oil revenues.

The traditionally dominant Spanish-descended elite gained far more than the indigenous peoples, who make up a large proportion of those who live in poverty.

Correspondents say revenues from the country's existing Amazon oil reserves are critical in keeping the country's economy afloat.

Oil sales account for about a quarter of Ecuador's GDP. According to the president of the country's Petroleum Industry Association, oil revenues have been put towards paying for both state sector salaries and a significant amount of the national debt.

Q&A: Ecuador's latest upheaval
24 Apr 05 |  Americas
Protest threat to Ecuador oil
26 Feb 02 |  Business
Country profile: Ecuador
19 Jul 05 |  Country profiles

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